Wednesday morning, Starbucks (SBUX 1.24%) posted a quarterly earnings report that beat analyst revenue expectations. That wasn't enough to lift its shares into positive territory, though they only dipped by 0.6% in price on the day.
Lukewarm performance?
Before market open, Starbucks served up its first quarter of fiscal 2026 results. For the period, its net revenue rose 6% year over year to $9.9 billion. That was on the back of 4% growth in global comparable store sales.
Image source: Starbucks.
The bottom line followed a much different trajectory. The company's net income in accordance with generally accepted accounting principles (GAAP) fell to $293 million from first quarter 2025's nearly $781 million. On a per-share, non-GAAP (adjusted) basis, net earnings declined to $0.56 from $0.69.
Starbucks beat the average analyst estimate for revenue, but missed slightly for profitability. Collectively, pundits tracking the coffee slinger were modeling net revenue of slightly more than $9.6 billion and adjusted net income of $0.59 per share.
The company managed to squeeze out growth in both its U.S. stores and its international outlets. It attributed the decline in profitability to labor investments it said were tied to its "Back to Starbucks" revitalization strategy and to inflationary pressures, primarily higher coffee input costs and tariff-affected expenses.
NASDAQ: SBUX
Key Data Points
Not a disaster, but not a runaway success either
Starbucks also provided guidance for the entirety of the current fiscal year. It's forecasting that both net revenue and comparable sales will grow at a 3% clip over fiscal 2025, not least because it anticipates the opening of roughly 600 to 650 net new coffee shops during the year. Adjusted net income should land at $2.15 to $2.40 per share; the 2025 figure was $2.13.
Starbucks has been something of a pariah stock in recent months, largely due to uninspiring results; a wave of store closures also doesn't help investor (or consumer) morale. Considering that, its first "quarterlies" for the new fiscal year certainly weren't bad, although I still don't think we're seeing any significant operational or fundamental changes with the Back to Starbucks program.
